US president Barack Obama met with senate Democrats in the Oval Office, as he and Congress struggled to formulate a plan that would re-open government and extend US borrowing authority.

Negotiations to end the US fiscal crisis, which has gripped Washington and spooked financial markets, are hanging by a thread after breaking down in the House of Representatives and entering preliminary stages in the Senate.

Washington has barely five days to strike a deal that raises the US debt ceiling before the Treasury exhausts its borrowing authority and risks failing to pay the country's obligations.

But talks between Republicans and Democrats still show no sign of major progress.

Senate majority leader and Democrat Harry Reid laid down tough markers after a meeting with Senate Republican leader Mitch McConnell, leaving doubts over whether the two can reach an agreement to end a partial government shutdown, now in its 12th day.

"We need to have compromise but we are not going to do that until the government reopens and we pay our bills," Mr Reid warned.

Senator Dick Durbin, the second-ranking Democrat, said the goal was to reach a bipartisan deal in the Senate before financial markets reopen on Monday.

But the road to a deal appeared difficult, as Mr Reid dismissed Republican Senator Susan Collins's plan to extend the US debt limit until January 31, and to fund the government for another six months.

Immediately after a news conference, Mr Reid and other Senate Democratic leaders rushed to the White House for meetings with Mr Obama.

The White House provided barely 15 minutes' notice for the meeting, which comes as the onus for cobbling together a crisis-aversion strategy shifts from Republican politicians in the House of Representatives to members of the Senate.

Mr Obama is pleading for an end to the fiscal brinkmanship.

"It inflicts real pain on real people. It creates spasms of uncertainty for business owners," he said.

"It threatens our nation's credit and standing in the world.

"The longer it goes on, the more frequently this brinksmanship is inflicted, the more we'll see markets react, businesses put off plans to spend and hire, and unemployment claims tick up."